Brexit: Impact on UK's Trade, Security, Governance, and Economy

This report analyzes the impact of Brexit on UK's trade, security, governance, and economy. It discusses the trade and cooperation agreement, security and governance, and the impact on UK's growth, jobs, and specific regions like Ireland, London, and Scotland. It also highlights the advantages and disadvantages of Brexit.

Individual Report

Table of Contents
INTRODUCTION 3
MAIN BODY...................................................................................................................................3
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................1

INTRODUCTION
As we all know that UK has left the EU and it is names as BREXIT, hence some of the
experts have commented that the country's parliamentary sovereignty was indeed undermined by
the European union. Due to this the country UK has finally got back its independence. The
present report will be based on agreement related to BREXIT such as cooperation and trade
agreement. In addition to this, it will provide detailed information about security and governance.
This change has impacted the country trade especially the business organization, they were afraid
of the free movement of refugees and immigrants. When British was a part of EU they were
frustrated by EU fees, thus they felt is better to leave the union which will provide benefit to
people and would also create jobs. Plus, it has been noted that those people who voted to stay
with the EU primarily lived in London, northern Ireland and Scotland. Many of the citizen felt
that leaving the EU would be really harmful for them. Most of them felt that this decision would
damage the global status of UK and its people.
MAIN BODY
Brexit is the shorthand for British Exit from EU.
THE TRADE AND COOPERATION AGREEMENT
TRADE
With Brexit UK exited from the customs union and single market with the European
Union. Currently UK's trade agreement allow zero tariffs and quotas relating the goods that are
being traded in compliance with origins appropriate rules. UK and EU free movement has ended.
The nationals of European Union still living in UK make sure they have specific documents
allowing their stay by the UK government (Tetlow and Stojanovic, 2018). Passports are must for
the travellers between EU and UK. Local subsidiary needed to be established by the businessmen
of UK to operate regularly in any country that is part of EU. Services like telecommunications,
electronic services and broadcasting are now taxed. By 2064 payment of 34 billion pounds as
divorce bill is mandated for the UK. The amount payment is required to pay for the remaining
commitments in financial terms created as an EU member. Big strain was put on the UK's
relation with the Republic of Ireland, neighbouring country to UK and a member of EU. There is
not hard border between Ireland and UK because as per the new agreement Northern Ireland is

allowed to adopt rules based on EU customs. Customs and regulatory border exist between Great
Britain and Northern Ireland.
SECURITY
UK will now cooperate with EU on matters relating to law enforcement and justice matters
regarding criminal offences.
GOVERNANCE
Joint partnership council established following the agreement. The establishment safeguards the
proper application and interpretation of the agreement (De Ville and Siles-Brügge, 2019). The
circumstances included are settlements of disputes, enforcing the legalities and retaliating rules if
required.
BREXIT IMPACT ON UK
The sufferings for UK due to Brexit started before the actual exit took place. The economy
experienced declining trend. The headquarters of various businesses made their shift to EU. The
economic impact of Brexit on UK is multi folded, impact on whole UK as well as area specific
impact on Ireland, London and Scotland.
GROWTH
UK's growth in economic terms damaged as a result of Brexit. 2.4% growth as in year 2015
reached to 1.6% growth rate as in year 2019 due to the Brexit's uncertainties. The government
estimates up to 6.7% fall in the growth of UK in upcoming 15 years (Fagan and Rubery, 2018).
The mentioned estimation is further based on the assumptions from the current scenario of free
trade and restrictions being imposed on immigration.
JOBS
Adverse impact are being felt among the younger workers of the UK. Germany's statistics
projected the figure of 3 million in context of skilled workers' shortage by 2030. For the workers
of UK readily available jobs vanishes off post Brexit. Employers too experiencing tough time
searching applicants majorly because workers belonging to EU migrated from UK. The worst hit
sectors are low skilled and medium skilled occupations.
IRELAND
UK continued to have Northern Ireland as its part while EU have The Republic of Ireland.
Customs based borders between the two Irish countries is avoided as per the agreement. Thirty

year clash existing in Northern Ireland between two groups, Catholic Irish nationalists and pro-
British Protestants would have reignited with the differences.
LONDON
London the financial centre of UK has depressed growth. The financial growth of London was
1.4% as in 2018 and almost zero in 2019. Business investment reduced by 11% in three years
(2016-2019). EU's international companies less likely to allow using English-speaking entry by
London. 5000 clients of Barclay transmitted to the subsidiary at Ireland (O'Rourke, 2019). Ten
percent clients shifted by JP Morgan, Goldman Sachs and Morgan Stanley. A hundred bankers of
Bank of America switched to bank's office of Dublin with 400 transfers to Paris' broker dealing
unit.
Scotland
Brexit's denial votes came from the Scotland, based on its belief that being a part of EU is best
suited for Scotland and UK. Scotland seeks second referendum from government of UK keeping
in view the procedure to be a member of EU.
SUPPORTERS OF BREXIT
A small majority of voters supported Brexit in the referendum of 2016, since then growth seen in
the support (Arnorsson and Zoega, 2018). Conservative and populist voters these were the
segments who favoured the event. The segments in disagreement were low wage and low skilled
voters.
Advantages from Brexit:
More freedom to United Kingdom in terms of creation of its own deals of trade and regulations
for trade. This freedom comes from the hard Brexit situation. The scenario where complete
giving up of access by UK to the single market and customs union. Even for the people opting
for the stay in the EU look the Brexit as an event of regaining sovereignty. The Brexit ended free
movement resulting in getting back the control over the borders by UK. UK got control over its
lawmaking process democratically (Sohns and Wójcik, 2020). Restoring of the supreme court of
UK by making it the final decision authority for the law applying to UK. The country also
benefited in making it tough for the criminals from EU to enter UK. The acceptance of identity
cards ended for most of the nationals of EU travelling to UK. Control over the waters taken back
by the UK. Fair access to UK's system for welfare restored. Through global tariff UK established

its own regime for tariff. The blue passports were reintroduced. The businesses can now use a
crown stamp symbol.
Disadvantages from Brexit:
As a part of EU, UK had numerous benefits in terms of trade deals and other world powers. The
bargaining power of EU is the strongest reason being the largest economy. The power to
negotiate and ease of free trade with countries part of EU has been lost by UK. The probability
of getting favourable or desired results in trying to create and recreate trade deals is low.
Volatility is cause of Brexit uncertainty (Khabaz, 2018). Operations of businesses within UK got
affected largely. The cost of raw materials are subject to tariffs. Import of goods and services and
raw materials and export of finished goods became costlier.
It has been noted that there was good news in the UK for the car and auto mobile
industry, the reason behind fact that as per the new agreement investment into electric vehicles
has started instantly which is a good sign for UK progress (Clarke and et.al., 2017). Not only
Brexit, but the UK has suffered a lot because of pandemic, as on that basis exports to the EU
were down 12% . while on the other hand imports from the EU were down almost about 20%
lower than before the Covid-19 pandemic. Although country is now at good position to deal with
any challenge by adopted major initiatives with the support of government but some of the areas
are still recovering.
CONCLUSION
To conclude, The sufferings for UK due to Brexit started before the actual exit took place
and plus, business activities and operations within the country was highly got impacted. Due to
this, cost of raw materials was highly got impact which has also influenced the export and import
function of products or services as it become costlier than ever. By evaluating report it has also
been concluded that Brexit was important too, because business owners especially medium-
small industries owners felt that it will create new trade restrictions between the UK. In addition
to this Brexit making it tough for the criminals from EU to enter UK which is a good sign.
Furthermore, report has summarized that Brexit car plants get components from EU and export a
majority of completed cars to this country that is Europe as well. Some argues that Due to this
many industries such as manufacturing plants may become unprofitable which needs to be taken
into consideration to avoid any uncertainty. The supply chain management of industries were
also been impacted, hence companies in the UK will need to hold more inventory so that they

can easily avoid delays and uncertainty too. Not on this, financial services sector has also been
impacted by this big decision. For instance, UK banks may not be able to access the market of
Europe.

REFERENCES
Arnorsson, A. and Zoega, G., 2018. On the causes of Brexit. European Journal of Political
Economy, 55, pp.301-323.
Clarke, H. D. and et.al., 2017. Brexit. Cambridge University Press.
De Ville, F. and Siles-Brügge, G., 2019. The impact of Brexit on EU trade policy. Politics and
governance. 7(3). pp.7-18.
Fagan, C. and Rubery, J., 2018. Advancing gender equality through European employment
policy: the impact of the UK's EU membership and the risks of Brexit. Social Policy
and Society. 17(2). pp.297-317.
Khabaz, D., 2018. Framing Brexit: The role, and the impact, of the national newspapers on the
EU Referendum. Newspaper Research Journal. 39(4). pp.496-508.
O'Rourke, K., 2019. A short history of Brexit: From Brentry to backstop. Penguin UK.
Sohns, F. and Wójcik, D., 2020. The impact of Brexit on London’s entrepreneurial ecosystem:
The case of the FinTech industry. Environment and Planning A: Economy and
Space. 52(8). pp.1539-1559.
Tetlow, G. and Stojanovic, A., 2018. Understanding the economic impact of Brexit. Institute for
government, pp.2-76.
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